Oil Minister Rafael Ramirez said the loan will help PDVSA reduce its debt load and speed up development of a joint project with Gazprom in western Zulia state.

Ramirez said another loan for $1.2 billion from Spain's Repsol should be finalized next month. That would bring to nearly $10 billion the amount PDVSA has raised from its foreign oil partners this year.

While Venezuela sits atop the world's largest oil reserves output has steadily declined in recent years as a result of mismanagement and underinvestment.